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FTC acts against private equity firm’s acquisition of veterinary clinics

ftc.gov

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Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#171

Post by [deleted] »

pclmulqdq wrote: post #142
Avicebron wrote: post #129

Earlier quoted context omitted.

what do you mean? That's exactly capitalism, it favors inequality heavily. The Vet made it to the top of the heap, and is now utilizing the PA as an exploitable workforce. Tech example, BigCo A gets first mover advantage, equally good BiggishCo B is a bit behind (for whatever reason), BigCo A leverages their position to prevent B from being able to compete long term - usually by acquisition, they work for us now.

It's not capitalism because a licensing cartel artificially keeps the supply of vets low by keeping out qualified PAs and nurses who could handle easy cases.

[deleted]

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#172

Post by guelo »

torbTurret wrote: post #148
PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

PE are truly the cockroaches of our society.

Please show some respect for your overlords.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#173

Post by pc86 »

pclmulqdq wrote: post #147
amelius wrote: post #105

Earlier quoted context omitted.

Dentists will go down the same route.

Dentists seem to generally be decent businesspeople, while doctors and vets aren't, so they may resist PE buyouts for a while.

I'm curious why this is as it seems to have been the case in my experience as well.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#174

Post by neoromantique »

sitkack wrote: post #143
3maj wrote: post #42

Earlier quoted context omitted.

Couple of comments. Hedge Funds don't invest in trailer parks, if they did they wouldn't be hedge funds they would be PE firms or REIT's. While the US Industrial Complex is a cancer to the system I don't think they're to blame for Russia invading Ukraine. Instead, the US government needs to stop non-bid contracts and paying these companies "cost + Percentage" contracts. Also the FP article misses out on a lot of nuan…

I don't think any of us have visibility in the precursors to a proxy war that the US is very delighted to be in right now.

That's very conveniently pro-Kremlin rhetoric here. I'm sure US is very delighted with markets crashing and burning everywhere, including US.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#175

Post by dhosek »

shakes_mcjunkie wrote: post #82
PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

> They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. I searched recently for a nearby vet in Chicago and probably out of 15, only 1 was not owned by a larger chain or company. Big bummer. It's hard to trust that a vet that's part of a chain isn't going to have perverse incentives when it comes to carin…

My brother owns Merrick Animal clinic in Brookfield. The other thing to investigate would be independent vets doing house call practices which, assuming you can find one, would be cheaper than a clinic and much less stressful for the animals (my brother did that before buying Merrick 14 years ago).

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#177

Post by SomeBoolshit »

PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

It all started going a very wrong way when animal health insurance became a thing.

I've always had vets peddle weird stuff but that was a real eye opener.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#178

Post by willcipriano »

whimsicalism wrote: post #124
astockwell wrote: post #111

Earlier quoted context omitted.

Nope. Barriers to entry in the market (securing capital for initial expenditures, rising rents, rising malpractice liabilities) will make providers take positions at the PE-owned practices. Monopolization works in both directions.

As profit increases, those barriers become increasingly more worth it to climb. Increasing profits does not make start up costs worse.

The barriers go up higher as the increased profits are funneled towards the creation of new regulations to prevent competition.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#179

Post by snapetom »

ensignavenger wrote: post #136
snapetom wrote: post #118

Earlier quoted context omitted.

Most of the corporations don't make it known that the clinic is corporate owned. They sweep in, buy the clinic, and keep the owner in charge. Marketing and branding is kept as-is to keep the small, neighborhood clinic feel. Some of that is changing depending on the corporation. Sometimes you'll see "Main Street Vet Hospital, a Megacorp Vet Clinic" or they'll rebrand speciality clinics and large hospitals with the cor…

If nothing changes for the customer, then why is it a bad thing? Why should consumer care who owns the clinic?

Ideally they shouldn't care. I was giving an example of why consumers would choose to go to a corp clinic over independent - they simply don't know it's corporate owned.

I'm not going to argue whether it's bad. I've met plenty of good independent vets, plenty of bad ones. Plenty of good corporate vets, plenty of bad ones.

Re: FTC acts against private equity firm’s acquisition of veterinary clinics

#180

Post by conductr »

legitster wrote: post #67
PragmaticPulp wrote: post #61

Vet clinics became very popular private equity targets recently. One of the people I know in PE described their profit margins as being surprisingly high even before PE roll-ups. They said that some PE firms were on a mission to acquire all of the vet firms in metro areas and then drive prices up even further because the demand is so inelastic. There was a secondary rush where people were trying to acquire vet clinic…

I worked with people who did (human) clinic roll ups. Part of the issue at hand is that doctors and physicians are notoriously bad businesspeople. So once they build up a big enough practice, a lot of them will jump on the chance to sell the side of the business that they hate to a management firm.

I’ve hands on done these roll ups in mass (a ton of tiny M&A deals) and I would not characterize the physicians that way at all. They are generally fairly savvy small business owners and they always saw their practice as a retirement/nest egg. They also tend to burn out on all the insane regulations/insurance/employer/etc hoops they have to jump through and as a small business they tend not to have negotiating power or the scale to leverage shared services. These are the primary benefits of the roll up along with jacking up prices as much as possible obviously.

Like many physicians these days, they see benefits of just being a W2 employee. It’s also a demographic wave, there’s a lot of near retirement folks that are winding down and these PE firms are providing liquidity for their practice. For the consumer though, it’s probably not a good thing at all

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